Prime Minister Anthony Albanese has defended his government's decision to end a temporary fuel excise tax cut, a move that comes as Australian drivers face surging petrol prices.
The Australian government had halved the fuel excise for three months starting in April, a measure that saved drivers 32 cents per liter. This discount was extended for an additional month in July, but at a reduced rate of 16 cents per liter. The excise cut is set to lapse on August 2.
Albanese stated that the measure was always intended to be temporary. He added that the government has been focused on ensuring fuel supply amidst ongoing tensions in the Middle East. "What we've moved to is permanent cost-of-living support," Albanese told ABC, referencing tax cuts implemented on July 1, an increase in the minimum wage, and a planned expansion of paid parental leave to six months.
The decision to end the excise cut comes as global oil prices rise, with Brent crude exceeding $100 a barrel due to fresh tensions between the United States and Iran. Reports indicate that petrol prices in Australia could surpass $2 a liter as the discount is removed.
Average unleaded petrol prices have climbed to over $1.80 per liter in state capitals, up from approximately $1.50 at the end of June. These increases in oil prices are linked to recent attacks by Iran-aligned Houthi militants on Saudi oil installations and Iran's attempts to disrupt shipments through the Strait of Hormuz, a critical oil transit route. U.S. strikes have recommenced in response to Iranian attacks on vessels in the strait.
Albanese acknowledged the global impact of the conflict. "The war is having an impact here in Australia and the longer it goes, the bigger the impact will be," he said. "This is a war on the other side of the world. We are not protagonists in it, but we are impacted by it and we've consistently called for a de-escalation."